The Effect of Social and News Media Sentiments on Financial Markets

Hu, Tianyou

doi:10.2139/ssrn.2964054

Cited by 7 publications

(9 citation statements)

References 21 publications

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“…By contrast, Antweiler and Frank (2004) and Kim and Kim (2012) find no support for the hypothesis that the sentiment of social media messages contains financially relevant information in terms of its association with stock returns. Interestingly, Hu and Tripathi (2016) obtain results that lend support for the value relevance of sentiment extracted from stock forums, as opposed to media news platforms. The study is revealing as its findings implicate the presumable superiority of social media over other types of media, including online, in conveying sentiment signals potentially leading to additional market returns.…”

Section: Sentiment Analysis Literaturementioning

confidence: 74%

“…In Japan, Okada and Yamasaki (2014) demonstrate that mid-year stock market return seasonality as reflected in the saying 'sell in May and go away' is almost perfectly associated with the sentiment proxy they adapted and extracted from Japanese media news. The most recent studies mine not only online newspapers columns, but also the most influential newswires such as Dow Jones, Thomson Reuters, and Google Finance (Heston and Sinha, 2014, Chouliaras, 2015, Hu and Tripathi, 2016.…”

Section: Sentiment Analysis Literaturementioning

confidence: 99%

“…Some latest studies even suggest that social media can outperform other sources of signals potentially useful for investors in predicting financial market returns (e.g. Hu and Tripathi, 2016).…”

Section: Introductionmentioning

confidence: 99%

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Can Social Media Content Increase Financial Market Returns? Survey Results from Poland

Cwynar

Pater

2017

Organizacija

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Background and Purpose:In recent years classic financial market theory based on decision makers' rationality has been challenged by repeated anomalies that became a 'new normal'. As a result, what we witness today is a considerable turn to behavioral concepts that can shed a new light on choices made by market participants. The astonishing development of social media accelerated scientific validation of such concepts, since the media opened new and capacious 'laboratory space' for testing behavioral hypotheses. The main purpose of the article is to examine whether financial market professionals believe that social media content can be useful in achieving additional financial market returns and to investigate the factors behind this belief. Design/Methodology/Approach: We surveyed a sample of over 400 financial market professionals at institutions operating in Poland, and analyzed the results using logit regression models. Results: We established that almost 60% of the surveyed finance professionals recognized the potential of social media for achieving additional returns. We also found out that the differences in respondents' perception of this potential could be explained mainly by heterogeneity of their job experience and, to a lesser degree, by their job position. Interestingly, more experienced individuals were less likely to recognize this potential. Firm-specific factors did not have a significant effect on the dependent variable. Conclusion: The opinions of financial market professionals regarding the link between social media and additional returns are mixed, which is consistent with the current body of evidence brought by sentiment-based research. Our findings confirm the key role of previous experience in explaining attitudes towards novelties and innovations (such as social media), a phenomenon known from other fields and everyday experience.

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Section: Sentiment Analysis Literaturementioning

confidence: 74%

Section: Sentiment Analysis Literaturementioning

confidence: 99%

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Can Social Media Content Increase Financial Market Returns? Survey Results from Poland

Cwynar

Pater

2017

Organizacija

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“…LinkedIn was the most popular platform helping financial professionals to develop their expertise and expand business. The findings of Hu and Tripathi (2016) suggest that information available on social media does not overlap with information accessible through news media. Thus, social media are additional or complementary sources of news, rather than the substitutive information channel.…”

Section: Social Media As An Information Sourcementioning

confidence: 93%

Social Media as an Information Source in Finance: Evidence from the Community of Financial Market Professionals in Poland

Cwynar¹,

Cwynar²,

Pater³

et al. 2019

IJDAR

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Social media has become a source of information for individuals making decisions in financial institutions worldwide. As a part of Business Intelligence systems, platforms such as Facebook, Twitter, or LinkedIn provide financial market professionals with a magnitude of market data-for example, stock price expectations, customer insights, and market sentiment. Based on 415 survey responses of financial market professionals in Poland (purposive sample), this study examines factors behind social media usage in financial institutions. We found that decision-makers representing these institutions seldom use social media for job-related purposes. However, the professionals from institutions that manage more diversified asset portfolios and hold the most risky assets in the portfolios, are more likely to use social media for information purposes. We also found that the value of assets does not affect the use of social media for information purposes among financial market professionals in Poland. This implies that representatives of certain types of financial institutions are more inclined to use social media for professional purposes. Our study offers an insight into the variables that best explain the decision to monitor social media content by financial market professionals. Thus, it can provide a basis of recommendations aiming to enhance the market for business information.

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“…Given today co-existence of social media and traditional news media (newspaper or online news media), the authors in [25] compare the performance of social media and news media in predicting returns in the Australian market. It is clear that social media outperforms traditional media on the capability for readers to interact or further spread information.…”

Section: Introductionmentioning

confidence: 99%

Twitter permeability to financial events: an experiment towards a model for sensing irregularities

Vilas

Redondo

Crockett

et al. 2018

Multimed Tools Appl

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There is a general consensus of the good sensing and novelty characteristics of Twitter as an information media for the complex financial market. This paper investigates the permeability of Twittersphere, the total universe of Twitter users and their habits, towards relevant events in the financial market. Analysis shows that a general purpose social media is permeable to financial-specific events and establishes Twitter as a relevant feeder for taking decisions regarding the financial market and event fraudulent activities in that market. However, the provenance of contributions, their different levels of credibility and quality and even the purpose or intention behind them should to be considered and carefully contemplated if Twitter is used as a single source for decision taking. With the overall aim of this research, to deploy an architecture for real-time monitoring of irregularities in the financial market, this paper conducts a series of experiments on the level of permeability and the permeable features of Twitter in the event of one of these irregularities. To be precise, Twitter data is collected concerning an event comprising of a specific financial action on the 27th January 2017: the announcement about the merge of two companies Tesco PLC and Booker Group PLC, listed in the main market of the London Stock Exchange

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The Effect of Social and News Media Sentiments on Financial Markets

Cited by 7 publications

References 21 publications

Can Social Media Content Increase Financial Market Returns? Survey Results from Poland

Can Social Media Content Increase Financial Market Returns? Survey Results from Poland

Social Media as an Information Source in Finance: Evidence from the Community of Financial Market Professionals in Poland

Twitter permeability to financial events: an experiment towards a model for sensing irregularities

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